Gov`t Starts Accepting Chinese Investment Applications

Source: CENS Publications

The Ministry of Economic Affairs (MOEA) publicized a list of 192 permitted investment items for Chinese investors and started to accept their investment applications yesterday (June 30), ushering in the era of two-way cross-Taiwan Strait investments.

Shortly afterwards, Mainland Affairs Council (MAC), the Ministry of the Interior (MOI), and Financial Supervisory Commission (FSC) also publicized corresponding measures, according to which Chinese investors will be able to set up companies and purchase realties on the island.

The list focuses on sectors with mature domestic industries, covering manufacturing, service, and infrastructure, which underscore the trial nature of the policy.

An MOEA official noted that the MOEA can complete the screening process for Chinese investment applications within one month, adding that Chinese investment benefits can surface within half a year.

Liang-tung, executive secretary of the MOEA`s Investment Commission explained that the permitted investment list includes 64 manufacturing items, 117 service items, and 11 infrastructure items.

The manufacturing items include textile, auto/motorcycle, rubber/plastic, home appliances, computer peripherals, passive components, excluding, though, such sensitive items as flat panel display (FPD), semiconductor, Chinese herbal medicine, and construction.

The service items consist mainly of retail and wholesale businesses for daily necessities and direct cross-Strait marine and air transportation. Chinese investors can engage in second-category telecom businesses but their stakes are capped at 50%.

For infrastructure, Chinese investors can hold under 50% stakes in civil airport and harbor facilities. They, though, cannot undertake engineering works for infrastructure projects.

John Teng, vice economics minister, pointed out that Chinese enterprises can now apply for the establishment of subsidiaries or branches in Taiwan directly or invest in subsidiaries via a third place. Those with Chinese military background and those with monopolistic or dominating business nature or with threat on national security will be denied of the right to invest in Taiwan.

According to the corresponding measures publicized yesterday, Chinese corporate investors will be able to purchase offices, factory buildings, or dormitory buildings, and individual Chinese can also purchase properties on the island. To avoid manipulation, Chinese people can only transfer their residence ownership after having registered their possession for three years, but commercial-property ownership is exempt from the restriction.

Chinese property owners can stay on the island up to four months a year, up from one month now, and are free from the restriction on the duration of each stay and the number of stays.